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November 19, 2010

Competitive advantage or necessary evil?

I recently watched a story about Blockbuster (you know the video store). The CEO of Blockbuster Australia was reacting to all of his video on demand competitors (Microsoft via Xbox, Sony via PS3, and various telecommunications companies) by saying,"what do they know about video?... we have been in the video business for decades."

The point of difference he put forward seemed to be that people enjoyed coming into the store to deal with the video experts. According to the Blockbuster CEO the in-store experience mattered (possibly because Blockbuster doesn’t seem to have a solid alternative strategy).

I think it is a classic example of an inability to conceive a future that is significantly different from the present. Our confidence in the present influences our aspirations for the future.

For most people the actual trip to the store is not an “experience” but a necessary evil. Sure some people are movie buffs… they might want to visit the store for the atmosphere, sure some people don’t have broadband… they will still have to visit the store, but for the majority of people the store visit (and return trip) is a necessary evil.

Sure a great in-store experience is a competitive advantage when customers have to visit the store… but when they don’t (have to, or, even want to) what are you left with?

What in your business are you continuing to treat as a competitive advantage that your customers consider a necessary evil? You might be surprised.